This paper considers whether foreign aid donors suffer from a lack of coordination in the spatial placement of foreign aid projects. Subnationally, some regions are disproportionately plagued by violence, disease, poverty, and other related ills whereas others are not, and yet little is known about how well donors coordinate to target these areas.
We present an initial framework for assessing the level of donor coordination subnationally based on both geographic clustering of donor activities and concentration of need. If donors cluster projects in areas with concentrated need, or spread out projects in areas of diffuse need, then we conclude that donors are coordinating well. Because cofinancing may be one mechanism by which donors coordinate their efforts, we examine whether the frequency of donor co-financing increases the quality of coordination.
Theoretically, greater levels of co-financing should lead to better information sharing and fewer incentives to claim exclusive credit for activities. Using new subnational geo-referenced foreign aid data for the World Bank (WB) and African Development Bank (AfDB), based on coding with full project documentation, we map the coordination of foreign aid along with subnational poverty levels. Results indicate that coordination problems and inaccurate targeting of needs abound in some countries, and there is some limited evidence that countries with higher frequency of co-financed activities achieve better overall donor coordination.